EMPLOYMENT AGREEMENT

Agreement does not provide for any automatic renewal.  Notwithstanding the end of the Executive’s period of employment, this Agreement shall remain in full force and effect thereafter for the purpose of determining the Executive’s entitlement to any payments due under Sections 4(e) and (f) hereof.

(c)           Definitions .  Various terms are defined either where they first appear underlined in this Agreement or in Section.

2.             DUTIES .  During the period of employment, the Executive shall serve as Senior Executive Vice President and Chief Financial and Administrative Officer of the Corporation, and in such other additional office or offices to which he shall be elected by the Board of Directors of the Corporation (“ Board ”) with his approval, performing the duties of such office or offices held at the time and such other duties not inconsistent with his position as such an officer or director as are assigned to him by the Board or committees of the Board.  During the period of employment, the Executive shall devote his full time and attention to the business of the Corporation and the discharge of the aforementioned duties, except for reasonable vacations, absences due to illness, and reasonable time for attention to personal affairs and charitable activities.

3.             OFFICE FACILITIES .  During the period of employment, the Executive shall have his office where the Corporation’s principal executive offices are located from time to time, which currently are at 7201 Metro Boulevard, Edina, Minnesota and the Corporation shall furnish Executive with office facilities reasonably suitable to his position at such location.

4.             COMPENSATION .  As compensation for his services performed hereunder, the Corporation shall pay or provide to the Executive the following:

(a)           Base Salary .  The Corporation shall pay the Executive a base salary (the “ Base Salary ”), calculated at the rate of Four Hundred Seventy-Five Thousand Dollars ($475,000.00) per annum (which Base Salary may be increased, but not reduced, by the Compensation Committee of the Board (the “ Compensation Committee ”) at any time and from time to time in its discretion), payable monthly, semi-monthly or weekly according to the Corporation’s general practice for its executives, for the period of employment under this Agreement.  Such Base Salary may be increased annually by an amount determined by the Compensation Committee.  Such Base Salary, including such annual increases (which shall be considered part of the Base Salary), shall not be reduced during the period of employment hereunder.

(b)           Bonus .  The Executive shall be eligible for an annual performance bonus (the “ Bonus ”) as determined under the provisions of the Regis Corporation 2004 Short Term Incentive Compensation Plan, as amended from time to time, any successor to such plan, or such other annual incentive compensation program developed for the Corporation’s executive officers.

(c)           Other Incentive Plans .  During the period of employment, the Executive shall be eligible to participate in such other incentive compensation programs in accordance with their terms as the Corporation may have in effect from time to time for

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its executive personnel (including the Regis Corporation Long Term Incentive Plan, as amended from time to time, and any successor thereto), other than any annual cash bonus plan (which is dealt with in Section 4(b) hereof), and all compensation and other entitlements earned thereunder shall be in addition to, and shall not in any way reduce, the amount payable as Base Salary and Bonus.

(d)           Restricted Stock Units .   On the 2007 Agreement Effective Date, the Corporation shall grant the Executive restricted stock units with respect to Fifty Thousand (50,000) shares of the Corporation’s common stock, subject to the terms and conditions of the Regis Corporation 2004 Long Term Incentive Plan, including any amendments made to provide for such awards.  Such restricted stock units shall remain unvested and forfeitable until the day immediately preceding the fifth anniversary of the 2007 Agreement Effective Date; at such time the restricted stock units shall become fully (100%) vested, provided the Executive is employed by the Corporation (or a subsidiary of the Corporation) on such date.  Payment of such restricted stock units automatically shall be deferred until January 31 of the calendar year next following the vesting date provided in the immediately preceding sentence.

(e)           Payment to Cover Life Insurance Premiums or Other Purposes .  The Corporation previously agreed under the Insurance Agreement to pay the Executive, for a period of ten (10) years, an amount equal to the annual premium on a a policy with a face amount of Two Million Five Hundred Dollars ($2,500,000) insuring the Executive’s life, plus a gross-up for the federal and state income taxes imposed on such payment. In lieu of such payments and subject to the last sentence of this Section 4(e), the Corporation shall pay the Executive the sum of One Hundred and Twenty Thousand Dollars ($120,000) annually for three years starting in 2008, which the Executive may use to continue to pay life insurance premiums, income tax obligations or as the Executive otherwise may determine.  The Corporation’s obligation to make the payments provided for under this Section 4(e) shall cease upon the termination of this Agreement by the Corporation for Cause (as defined in Section 8 hereof).

(f)            Retirement Benefit .  The Corporation shall pay to the Executive, if living, or, if not, to his surviving spouse or other designated beneficiary (either sometimes referred to as the Executive’s “ Beneficiary ”) or to the Executive’s estate if there is no surviving Beneficiary, the following sums (sometimes referred to as his “ Retirement Benefit ”) upon the terms and conditions and for the periods hereinafter set forth:

(i)            Payments upon Retirement .  On the last day of the month next following the month in which the Executive (1) retires from employment with the Corporation after attaining age 65, or (2) reaches age 65 if he is then disabled within the meaning of Section 4(f)(iv), the Corporation shall pay to the Executive a lump sum cash payment of an amount equal to the present value of his Vested Monthly Benefit. For the purpose of determining the present value, the following assumptions shall apply:

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(1)           Interest: Payments shall be discounted to present value at a rate of interest equal to the yield to maturity of 30-year U.S. Treasury Notes as of the Executive’s termination of employment.

(2)           Payment Duration:  It shall be assumed that payments of the Vested Monthly Benefit will be made for two hundred and forty (240) months.

Notwithstanding the foregoing in this subparagraph 4(f)(i), Executive shall be entitled, by written election to the Corporation’s Board of Directors, to receive, in connection with a termination of employment at or after age 65, to have his Vested Monthly Benefit paid in monthly payments rather than the lump-sum described above, provided (x) Executive makes such written election more than 12 months before Executive attains age 65 (y) such election is not effective for 12 months, and (z) the first installment of the Vested Monthly Benefit is paid five years after the month next following the month of such termination of employment (or if earlier, upon death or disability pursuant to subparagraphs 4(f)(iii) and (iv), respectively).  Pursuant to (and subject to the requirements of) transitional relief  provided with respect to initial and redeferral elections under Code Section 409A (including without limitation, IRS Notice 2005-1, Notice 2006-79, the Preamble to the final Section 409A treasury regulations, and Notice 2007-86, any election made on or before December 31, 2008 shall not be subject to the foregoing timing requirements.

If this election is made, the Vested Monthly Benefit will be paid for two hundred and forty (240) months.  If Executive dies before receiving all 240 monthly payments specified herein, the Corporation shall pay to the Executive’s Beneficiary the remaining monthly payments as they become due as provided above.

(ii)           Early Termination .  In the event the Executive has a termination of  employment with the Corporation before reaching age 65 (unless the Executive has been terminated by the Corporation for Cause, or if the termination is by reason of disability pursuant to subparagraph 4(f)(iv), or by reason of death), then, on the last day of the month next following the month of the Employee’s termination of employment, the Corporation shall pay to the Executive a lump sum cash payment of an amount equal to the present value of his Discounted Vested Monthly Benefit.  For the purpose of determining the present value, the following assumptions shall apply:

(1)           Interest: Payments shall be discounted to present value at a rate of interest equal to the yield to maturity of 30-year U.S. Treasury Notes as of the Executive’s termination of employment.

(2)           Payment Duration:  It shall be assumed that payments of the Discounted Vested Monthly Benefit will be made for two hundred and forty (240) months.

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Notwithstanding the foregoing in this subparagraph 4(f)(ii), Executive shall be entitled, by written election to the Corporation’s Board of Directors, to receive, in connection with Executive’s termination of employment prior to age 65, to (i) be paid the lump sum cash payment on the basis of his Vested Monthly Benefit rather than the Discounted Vested Monthly Benefit (or based on his Discounted Vested Monthly Benefit but commencing at a later date if the payment date is prior to age 65), and/or (ii) to be paid in monthly payments rather than the lump-sum described above, provided (x) Executive makes such written election more than 12 months before Employee’s termination of employment (y) such election is not effective for 12 months following the date the election is made, and (z) the first installment of the Monthly Benefit (or the lump sum payment as applicable) is paid no earlier than five years after the month next following the month of Employee’s termination of employment (or if earlier, upon death or disability pursuant to subparagraphs 4(f)(iii) or (iv), respectively).  Pursuant to (and subject to the requirements of) transitional relief  provided with respect to initial and redeferral elections under Code Section 409A (including without limitation, IRS Notice 2005-1, Notice 2006-79, the Preamble to the final Section 409A treasury regulations, and Notice 2007-86, any election made on or before December 31, 2008 shall not be subject to the foregoing timing requirements.

If monthly payments are elected, the Vested Monthly Benefit (or the Discounted Vested Monthly Benefit (if payment commences prior to age 65)) will be paid for two hundred and forty (240) months.  If Executive dies before receiving all two hundred and forty (240) monthly payments specified herein, the Corporation shall pay to Executive’s Beneficiary the remaining unpaid monthly payments as they become due as provided above.

 (iii)         Payments upon Death before Separation .  If the Executive dies while employed by the Corporation, during the first six (6) months of disability, or while disability payments are being paid under subparagraph (iv), the Corporation shall pay to Executive’s Beneficiary a lump sum cash payment of an amount equal to the present value of Executive’s Monthly Benefit (based on the assumptions listed in subparagraph (ii), but with the 30-year Treasury Note rate determined at the Executive’s death), provided, however, that if Employee elected to receive monthly payments rather than a lump sum (as provided under subparagraph (i) and (ii), as applicable based on the age of the Executive at death), the Corporation shall pay to Executive’s Beneficiary Executive’s full Monthly Benefit for two hundred and forty (240) months.  The lump sum payment or the first monthly payment, as applicable, shall be paid within thirty (30) days after Executive’s death.

(iv)          Payments During Disability .  In addition to the payments provided in Section 4(f)(i) and (ii), should the Executive become disabled while employed by the Corporation, and such disability continues for a period of six (6) months,  the Corporation shall pay to the Executive his Monthly Benefit during each month that the Executive remains disabled until he attains age 65 or until his death prior to attaining such age, at which time the payment provided in

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Section 4(f)(i), (ii) or (iii) (whichever is applicable) shall be paid or begin (in the case of a lump sum, the 30-year Treasury Note rate shall be determined at age 65 or death, as applicable).  The first payment under this Section 4(f)(iv) shall be made during the seventh month of such disability, and each succeeding payment shall be made on the same date of each succeeding month thereafter.  Payments shall be made under this Section 4(f)(iv) only if the Executive is disabled within the meaning of the disability clause of the Corporation’s long term disability insurance policy or program as then in effect and within the meaning of “disability” as set forth in Treas. Reg. § 1.409A-3(i)(4).

(v)           Termination for Cause .  If the Executive’s employment with the Corporation is terminated at any time for Cause (as defined in Section 8), the Corporation shall have no obligation to make any payments to him or his Beneficiary under this Section 4(f) and all such future payments shall be forfeited.

(g)           Health, Welfare and Retirement Plans; Vacation .  During the period of employment, the Executive shall be entitled to:

(i)            participate in such retirement, health (medical, hospital and/or dental) insurance, life insurance, disability insurance, flexible benefits arrangements and accident insurance plans and programs as are maintained in effect from time to time by the Corporation for its headquarters employees;

(ii)           participate in other non-duplicative benefit programs which the Corporation may from time to time offer generally to headquarters personnel of the Corporation; and

(iii)          take vacations and be entitled to sick leave in accordance with the Corporation’s policy for executive personnel of the Corporation.

(h)           Expenses .  Executive shall be reimbursed for reasonable business expenses incurred in connection with the performance of his duties hereunder consistent with the Company’s policy regarding reimbursement of such expenses.  With respect to any benefits or payments received or owed to the Executive hereunder, the Executive shall cooperate in good faith with the Corporation to structure such benefits or payments in the most tax-efficient manner to the Corporation.

5.             EFFECT OF DISABILITY AND CERTAIN HAZARDS .  The Executive shall not be obligated to perform the services required of him by this Agreement during any period in which he is disabled or his health is impaired to an extent which would render his performance of such services hazardous to his health or life, and relief from such obligation shall not in any way affect his rights hereunder except to the extent that such disability or health impairment may result in termination of his employment by the Corporation pursuant to Section 6 herein.

6.             TERMINATION OF EMPLOYMENT .  The employment of the Executive by the Corporation pursuant to this Agreement may be terminated by the Corporation or the Executive at any time, as follows:

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(a)           Death .  In the event of the Executive’s death prior to the expiration of the period of employment hereunder, such employment shall terminate on the date of death.

(b)           Permanent Disability .  The Executive’s employment may be terminated by the Corporation prior to the expiration of the period of employment hereunder due to Executive’s physical or mental disability or health impairment which prevents the effective performance by the Executive of his duties hereunder on a full time basis, with such termination to occur (i) with respect to disability, on or after the time which the Executive becomes entitled to disability compensation benefits under the Corporation’s long term disability insurance policy or program as then in effect or (ii) with respect to health impairment, after Executive has been unable to substantially perform his services hereunder for six consecutive months.  Any dispute as to the Executive’s physical or mental disability or health impairment shall be settled by the opinion of an impartial physician selected by the parties or their representatives or, in the event of failure to make a joint selection after request therefor by either party to the other, a physician selected by the Corporation, with the fees and expenses of any such physician to be borne by the Corporation.

(c)           Cause .  The Corporation, by giving written notice of termination to the Executive, may terminate such employment at any time prior to the expiration of the period of employment hereunder for “ Cause ” (as defined in Section 8).

(d)           Without Cause .  The Corporation may terminate such employment at any time prior to said date without Cause (which shall be for any reason not covered by preceding Sections 6(a) through (c)) upon sixty (60) days prior written notice to the Executive.

(e)           By the Executive .  The Executive may terminate such employment at any time for an applicable Good Reason (as defined in Section 8), subject to Section 6(f).  The Executive may also terminate such employment for any other reason upon prior written notice thereof to the Corporation, and the Executive agrees to use his reasonable best efforts to provide twelve (12) months’ prior written notice in such event.

(f)            Notice of Good Reason .  If the Executive believes that he is entitled to terminate his employment with the Corporation for an applicable Good Reason, he may apply in writing to the Corporation for confirmation of such entitlement prior to the Executive’s actual separation from employment, by following the claims procedure set forth in Section 11 hereof.  The submission of such a request by the Executive shall not constitute “Cause” for the Corporation to terminate the Executive under Section 6(c) hereof; and the Executive shall continue to receive all compensation and benefits he was receiving at the time of such submission throughout the resolution of the matter pursuant to the procedures set forth in Section 11 hereof.  If the Executive’s request for a termination of employment for Good Reason is denied under both the request and appeal procedures set forth in Sections 11(a) and (b) hereof, then the parties shall promptly submit the claim to binding arbitration pursuant to Section 11(c) and use their best efforts to conclude the arbitration within ninety (90) days after the claim is submitted.

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(g)           Notice of Termination .  Any termination of the Executive’s employment by the Corporation or by the Executive (other than termination based on the Executive’s death) shall be communicated by a written Notice of Termination to the other party hereto.  For purposes of this Agreement, a “ Notice of Termination ” shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated.  For purposes of this Agreement, no purported termination shall be effective without the delivery of such Notice of Termination.

(h)           Date of Termination .  The “ date of termination ” of the Executive’s employment shall mean (i) if the Executive is terminated by his death, the date of his death, (ii) if the Executive’s employment is terminated due to a permanent disability or health impairment, thirty (30) days after the Notice of Termination is given (provided that the Executive shall not have returned to the performance of his duties on a full-time basis during such period), (iii) if the Executive’s employment is terminated pursuant to a termination for Cause, the date specified in the Notice of Termination, and (iv) if the Executive’s employment is terminated for any other reason, the date shall be the later of thirty (30) days after termination as provided by the Notice of Termination or the date of the final resolution of the arbitration and claims procedures set forth in Section 11 hereof, unless otherwise agreed by the Executive and Corporation or otherwise provided in this Agreement.

7.             PAYMENTS UPON TERMINATION .

(a)           Death or Disability .  If the Executive’s employment is terminated by reason of his death or permanent disability, he (or the legal representative of his estate in the event of his death) shall be entitled to the following:

(i)            Accrued Compensation .  All compensation due the Executive under this Agreement and under each plan or program of the Corporation in which he may be participating at the time shall cease to accrue as of the date of such termination, exce